Drivers due $175,000 from Peninsula taxi and limo company

Updated 5:57 pm, Wednesday, May 25, 2016

A Peninsula taxi and limousine company will pay $175,000 in back wages and damages to 36 drivers for wrongly classifying them as contractors rather than employees, the U.S. Labor Department announced Wednesday.

A federal judge ruled last year that drivers for Stanford Yellow Taxi Cab and AAA Legacy Limousine, both based in Mountain View, were employees entitled to minimum wages, overtime, compensation for expenses, and unemployment insurance coverage.

The owner, Sayed Abbas, required drivers to work 12 hours a day, six days a week, and paid them only a percentage of their fares — 40 percent for taxis, 30 percent for limousines — plus their tips, said U.S. District Judge Edward Davila of San Jose. He said Abbas tried to interfere with the Labor Department investigation and required drivers to sign lease agreements falsely claiming they worked independently.

Abbas consented to the compensation plan, which includes $87,500 in wages and an equal amount in damages.

“Employers like Sayed Abbas take advantage of vulnerable workers by making them sign sham independent contractor agreements that mask actual working conditions,” Labor Department attorney Janet Herold said in a statement.

The question of whether drivers are employees or independent contractors also is under review in cases involving the ride-hailing companies Uber and Lyft, whose drivers have somewhat more control over their work schedules and activities than cab drivers. Federal judges in San Francisco are considering cash settlements for drivers of both companies that leave their status unresolved.

Court rulings have generally classified cab companies as employers of their drivers.